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mba642article summary - Article Summary Rooting out Fraud...

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Article Summary: Rooting out Fraud in Your Organization APA citation Kramer, B. (2009). Rooting Out Fraud in Your Organization. Management Accounting Quarterly,10 (4) . Retrieved June 12, 2011 from http://www.imanet/PDFs/Public/MAQ/2009_Q3/Qsummer2009Kramer.pdf Introduction This article tells the true story of how a purchasing agent for a state government agency awarded $260,000 worth of fraudulent purchase orders in a four-year period. The article also details how the suspect was caught, how he confessed, and it details red flags for discovering fraud. Finally, the article provides a list of preventative measures that can help organizations deter fraudulent activity. Major points of the article Most companies think their employees are trustworthy. The ironic thing about fraud is that you need to place an employee in a position of trust before they have the opportunity to defraud you. There are three general categories types of fraud: misappropriation, fraudulent financial statements and corruption. Misappropriation refers to misusing funds or property for personal gain. Fraudulent financial statements typically consist of falsified invoices or purchase orders that never took place. Corruption refers to a quid-pro-quo situation where something is given in exchange for some type of kickback. These types of fraud are sometimes easy to spot, and sometimes they are well hidden. The author provides a listing of Red Flags to look for in your organization, which included the following: Red flags on kickback schemes Close relationship between purchasing agent and vendor
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This note was uploaded on 11/13/2011 for the course MBA 642 taught by Professor Jamesstephens during the Summer '11 term at Bellevue.

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mba642article summary - Article Summary Rooting out Fraud...

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